GAC disbands controversial subcommittees, as Strang threatens legal action

GILFORD — The Gunstock Area Commission voted to disband its audit and legal services subcommittees and to pay and release legal invoices from its ongoing internal investigation at its special meeting Monday morning. 

In doing so, Commissioners Doug Lambert, Jade Wood and Denise Conroy started the process of putting the conflict and contentiousness of the commission’s last month — and year — behind them. 

Not everyone, it became clear, considers the Gunstock’s controversy resolved. 

As Chair Pro Tem Lambert first tried to call the meeting to order, Belknap County Delegation Chair Rep. Mike Sylvia approached him. 

Sylvia has accused Gunstock Mountain Resort’s management of financial malfeasance. During the week of the management team’s resignations, Sylvia voiced his support for former commissioner Dr. David Strang and readiness to hire new senior management. 

“Vice Chair Strang has not been invited to this little assembly. Vice Chair Strang has not resigned,” Sylvia said. “From the delegation meeting — the alleged delegation meeting — on Aug. 1, all actions will be challenged and anything you do today and in the future is going to be before the court.” Sylvia continued speaking but Lambert cut him off, calling the meeting to order with the chair’s gavel. 

Ten members of the Belknap County delegation called an emergency meeting on Aug. 1, to appoint Conroy to the GAC and to accept former Commissioner Strang’s verbal commitment that he “would resign” once there was an additional member of the GAC to maintain quorum. Sylvia has claimed that the meeting was illegally noticed; hours before the meeting, County Attorney Andrew Livernois released a letter he sent to Sylvia stating he believed it to be legal. Sylvia is running for re-election for his seat in Belmont next month.

The meeting, called and temporarily chaired by Rep. Harry Bean of Gilford, brought about the return of Gunstock’s management team, who had resigned and promised to return only if Strang, and former Chair Peter Ness, were no longer part of the commission.

After the meeting, Lambert revealed that Strang filed an injunction against him personally, which he said he received at 12:03 a.m. Monday. Lambert said he filed a response and request for dismissal later Monday morning.

Once the meeting was underway, the GAC first voted to release an Aug. 11 letter from the independent auditing firm. Gunstock undergoes an audit annually and has used this firm in the past.

The letter stated that the audit, which began on June 20, had been delayed because of interruptions but is expected to conclude by Sept. 30. The letter also stated that the auditor had been asked to examine additional information outside their planned scope and/or year of review, which would likely increase the cost of this year’s audit.

In an interview after the meeting, Lambert said that the principal auditor “characterized the input they received from the audit committee as unprecedented and indicative of people that didn’t have a high degree of familiarity with the normal purpose and structure of an independent municipal audit.”

Lambert made a motion to disband the audit subcommittee. 

The committee was formed by Ness at the May 18 GAC meeting as an offering to members of the delegation who have advocated for more stringent financial oversight of the mountain. Ness appointed Strang to chair the committee, along with Rep. Barbara Comtois and John Plumer, a candidate for state senate and former representative meant to bring a civilian’s perspective to how Gunstock should be run.

Lambert described two violations as justification for disbanding the committee: They had acted beyond the bounds of their authority and had failed to keep regular minutes and meeting announcements per RSA 91:A. 

Lambert said that the audit committee had no authority to instruct the auditors to pause their work or to give directions to Gunstock Chief Financial Officer Catherine White, as had been reported to the GAC at its June 21 meeting. He cited Article II paragraph 3(e) of the commission bylaws, which states that committees shall have no independent decision making authority and that the findings and recommendations of committees shall not circumvent the authority of the full commission. 

Lambert also said that the public and the other members of the commission had no notice of the subcommittee’s meetings or any record that minutes had been kept, which he said both the bylaws and right-to-know law require. 

The result, Lambert continued, was that the commission as a whole was “left in the dark.” Disbanding the committee would bring audit coordinating work back before the entire commission, and promote public transparency. 

Both committees, formed at Ness’ discretion, embodied the tension between the GAC, the Belknap County Delegation and Gunstock’s management. Ness formed the legal services committee, consisting of himself, Wood and Strang, at the March 23 meeting to determine which counsel would represent the GAC and when. 

Conroy voiced support for disbanding both the audit and legal services committees. 

Given the size of the commission and of Gunstock, Conroy said she found it unusual and unnecessary that there were so many committees.

“Having all of these committees, number one, adds a lot of administration and bureaucracy that we have no evidence that we need,” Conroy said. “I think that given the fact that we have no indication of [financial malfeasance] — we’ve seen nothing untoward, nothing that’s out of order — I think it makes a lot of sense to keep this commission as streamlined as possible.”

Both committees were disbanded by unanimous vote of the three commissioners. 

The GAC then voted to release and pay legal invoices from Preti, Flaherty, Beliveau & Pachios for its investigation into the GAC’s lawsuit against the county delegation and investigation of Ness. 

A report from Attorney Peter G. Callaghan of Preti Flaherty was reviewed by the GAC at its July 1 meeting. Callaghan was further engaged to investigate what changes the GAC could make to prevent similar costs and conflict as occurred between the GAC and the delegation late last year and “whether the Commission is exposed to any liability for what transpired.” 

Lambert said he told Callaghan to continue with the investigation as authorized and that Callaghan had informed him that it would be completed by the end of August. 

The commission unanimously voted to release and pay three invoices to Preti Flaherty totaling approximately $70,000 — an exact total was not provided at the meeting — for the investigation. 

Wood, who voted against the initiation of this investigation at the April 20 meeting, said she has repeatedly advocated against legal action and implored the various GAC chairs to work with delegation Chair Sylvia to resolve conflicts between the two bodies. 

“I am eagerly awaiting the closure of this chapter so that we can move forward and start the healing process as a community,” Wood said. “I look at these legal invoices and they make me sick.”

Conroy also expressed disapproval: “As a former CEO, I see a lot of somebody loading up their plate while somebody else is paying for the buffet.” She also echoed Wood’s readiness to put the matter in the past.

“We’re at a new era here,” Conroy said. “The witch hunts that cost Gunstock, that cost the taxpayers, those are done — at least from my perspective.” She said that until the end of her term in 2023 she was committed to “engaging in actual work to fulfill this community, to fulfill this local economy, to enrich this business.” 

Public comment touched on the costs of the audit as well as legal services and on the future of the GAC. 

Bean emphasized that, with the opinion of Livernois, he remained confident in the legality of the Aug. 1 meeting. 

David Hershey, a candidate for state rep. from Alton, said he thought that any additional costs of the audit should fall on the shoulders of the individuals of the committee who had brought the audit outside its intended scope. He also advocated that the GAC hire someone to make sure the legal invoices, given their staggering size, were accurately billed. 

Lambert, after the meeting, said that while these motions are something to consider, his priority is that the commission move beyond its turmoil and toward its business of overseeing the mountain. 

The next regular GAC meeting will be Wednesday, Aug. 31, at 6 p.m., according to Lambert. He said during comment he hopes discussion of the master plan, as well as renovations to the Stockade Lodge and discounted tickets for county residents, will soon be back on the agenda.